Placing

RNS Number : 2923B

Cyan Holdings Plc

14 August 2008

 

Cyan Holdings Plc 

('Cyan' or 'the Company') 

Placing of new Ordinary Shares to raise £3.0 million 

Cyan Holdings Plc (AIM:CYAN.L), announces details of proposed placings ('Placings') by Cenkos Securities plc to raise approximately £3.0 million (before expenses) and a General Meeting ('GM'), to be held on 3 September 2008. It is intended that the net proceeds from the Placings will be used for general working capital requirements and will provide the Company with the resources to execute its strategy and to take it through to profitability. A document containing the Notice of the GM is being posted to all shareholders in the Company today.

Background to and reasons for the Placings

Cyan is a fabless semiconductor company focussing on the design, sale and support of a range of low power, richly featured 16-bit general-purpose microcontroller chips.

The Company was admitted to trading on AIM in December 2005. During 2007, the Company changed its management team and focused on a new strategy for distributing its products and reducing its manufacturing costs. Commencing in July 2007, the first six months of an 18 month plan saw the Company undertake a radical restructuring of the business. As well as successfully establishing relationships with distributors in Asia, the USA and Europe to help increase sales penetration, the Company concentrated on the recruitment of an experienced operations team, the development of a low cost entry level device for Asia, the creation of a new suite of products, expansion of the marketing team and significant investment in software development.

The second six months to 30 June 2008 saw the launch of new module products, initial orders and engagement with customers who have potential for initial volume orders in the second half of 2008. 

Manufacturing cost reductions on the eCOG1X family have resulted in significant improvements to the competitiveness of the Company's product range, including its new entry level device.  All significant development work for this second phase has been completed successfully and the Company now has products and customer engagements in Automated Utility Metering, Wireless Industrial Control and Asset Tracking markets. Each of these markets represents a large fast growing opportunity for the Company's new products, where Cyan offers price, performance or ease of use advantages, and often a combination of these advantages, compared to competitors.

Through exploiting the identified opportunities in these markets, the Company expects to complete the third and final phase of the 18-month plan, realising higher volume sales and leading to a profitable year in 2009. 

Having completed the business restructuring and demonstrated engagement in new markets the Directors believe that the Placing proceeds will provide the Company with the resources to execute its strategy to take it through to profitability.

Current trading and prospects

Trading remains in line with Directors' expectations and the Directors are confident of continuing the established trend of significant quarter on quarter improvements in turnover thus reaching profitability over the course of the next 12 months. Cyan has a readily identifiable market for its products and an existing and new product range that, the Directors believe, has key attractions for customers. With a strong sales pipeline and the fact that, following the Placing the Directors expect the Company to be fully funded, the Directors are excited about Cyan's prospects and view the future with confidence.

Details of the Placings

The Company intends to raise approximately £2.8 million, net of expenses, through the issue of 300,000,000 new Ordinary Shares at a price of 1p through the Placings. 

Application will be made to the London Stock Exchange for the new ordinary shares to be issued pursuant to the Placings to be admitted to trading on AIM ('Admission'). It is expected that Admission will become effective and that dealings will commence at 8.00 a.m. on 4 September 2008 in respect of all the new Ordinary Shares to be issued pursuant to the Placings. 

The Placings are conditional, inter alia, upon: (a) the approval, without amendment, of certain of the resolutions to be proposed at the GM to be held on 3 September 2008 at 10.00 a.m. at Dechert LLP, 160 Queen Victoria Street, London, EC4V 4QQ; (b) the Placing Agreement becoming unconditional in all respects and not having been terminated; and (c) Admission. 

Each of the Directors have subscribed for new Ordinary Shares as part of the Placings. Their current holdings and proposed holdings following the Placings are detailed below.

	Existing		Following the Placings
Director	Number of Ordinary Shares	Percentage of Issued Ordinary Share Capital	Number of Ordinary Shares	Percentage of Issued Ordinary Share Capital
David Gutteridge	250,000	0.1%	1,250,000	0.3%
Kenneth Lamb	250,000	0.1%	5,250,000	1.2%
Andrew Lee	2,045,454	1.4%	4,545,454	1.0%
Dr. John Read	363,636	0.2%	2,863,636	0.6%

The new Ordinary Shares are to be issued pursuant to the Placings will, when issued and fully paid, rank pari passu in all respects with the existing Ordinary Shares of Cyan and will be issued subject to the memorandum and articles of association of Cyan. 

Kenn Lamb, CEO of Cyan, commented: 'During the past twelve months we have made significant progress at Cyan and have completely re-focused the business. 

Our key markets are now in Automated Utility Metering, Wireless Industrial Control and Asset Tracking, and during this period we have made significant investments in product and software development to enable us to deliver a suite of new products through our recently established distribution channels in Asia the USA and Europe.

The final phase of our business plan has always been to significantly increase sales and this fund raising gives us the required working capital to achieve this. We have a strong sales pipeline and we look forward to a profitable year in 2009 and I view Cyan's future prospects with confidence.' 

For further information: 

Cyan Holdings plc 

Kenn Lamb, CEO                  Tel: [phone] 

Andrew Lee, Finance Director 

www.cyantechnology.com 

Cenkos Securities plc

Stephen Keys/Adrian Hargrave      Tel: [phone]

www.cenkos.com 

Media enquiries: 

Hansard Group

John Bick/Adam Reynolds               Tel: [phone]

www.hansardgroup.co.uk

Notes to Editors 

Based in Cambridge in the UK, Cyan Holdings plc is a fabless semiconductor company specializing in the development of applications solutions collectively known as 'Cy Solved(TM)' which are built upon the company's low powered, configurable eCOG1k and eCOG1x microcontroller chips. 

Cy-Solved incorporates ready to go solutions, software stacks, applications examples, modular software based on easy to use APIs, evaluation boards and production hardware modules from partners, all pulled together through Cyan's free integrated development environment CyanIDE(TM). Cy-Solved can be incorporated as-is into an application but also supports an ability to be easily customised - either way, giving users a head start on the road to market. Currently available Cy-Solved applications include RF-Solved, USB-Solved, Ethernet-Solved and Motor Control-Solved. 

The Company was founded in 2002 and listed on AIM in 2005. Cyan Holdings plc operates through the brand 'Cyan'.

Cenkos is acting as nominated adviser and corporate broker exclusively for Cyan in connection with the Placings and no-one else and will not be responsible to anyone other than Cyan for providing the protections offered to clients of Cenkos nor for providing advice in relation to the Placing.

Cenkos' responsibilities as Cyan's nominated adviser under the AIM Rules for Nominated Advisers will be owed solely to the London Stock Exchange plc and are not and will not be owed to Cyan or to any director or proposed director of Cyan or to any other person. No representation or warranty, express or implied, is made by Cenkos as to any of the contents of this Announcement.

This Announcement does not constitute an offer to sell or an invitation to subscribe for, or the solicitation of an offer to buy or to subscribe for, Ordinary Shares in any jurisdiction in which such an offer or solicitation is unlawful and is not for distribution in or into Canada, Japan, the United States, the Republic of Ireland or Australia (the 'Prohibited Territories') or to U.S. persons (within the meaning of Regulation S of the United Securities Act 1933 (as amended) (the 'Securities Act'). The Ordinary Shares have not been and will not be registered under the Securities Act or under the applicable securities laws of any state in the United States or any Prohibited Territory and, unless an exemption under such Acts or laws is available, may not be offered for sale or subscription or sold or subscribed directly or indirectly within the Prohibited Territories or for the account or benefit of any national, resident or citizen of the Prohibited Territories. The distribution of this Announcement in other jurisdictions may be restricted by law and therefore persons into whose possession this Announcement comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions.

The contents of this Announcement are not to be construed as legal, financial or tax advice. If necessary, each recipient of this Announcement should consult his, her or its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice.

This Announcement contains certain statements that are or may be forward-looking. These statements typically contain words such as 'intends', 'expects', 'anticipates', 'estimates' and words of similar import. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and therefore undue reliance should not be placed on such forward-looking statements. Forward-looking statements speak only as of the date they are made and neither the Company, Cenkos nor any other person undertakes any obligation to update publicly any of them in light of new information or future events except as required by the AIM Rules. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. 

 

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